Sterling Crashes to New 27-Month Lows on Hard Brexit Fears

The Sterling pound today fell to new 27-month lows against the US dollar as markets reacted to a poor UK jobs report and the uncertain British political environment. The GBP/USD currency pair was also adversely affected by comments from the two remaining Conservative Party candidates saying that the Irish backstop was dead.
The GBP/USD currency pair today fell from an opening high of 1.2519 to a 27-month low of 1.2396 in the American session and was trading near these lows at the time of writing.
The currency pair traded sideways during the Asian session before breaking down in the early European session and extending its losing streak for the rest of today’s session. Markets reacted negatively to the release of the UK labour market report for July by the Office for National Statistics. The sharp increase in the number of people collecting unemployment insurance to 38,000 spooked investors who were expecting a figure below 22,800. The number of jobs created in the 3 months to May also missed expectations dragging the pair lower. The pair crashed after both Boris Johnson and Jeremy Hunt confirmed that they wanted to renegotiate the Irish backstop, a move the EU has categorically rejected.
The cable had a mild reaction to Mark Carney‘s speech delivered at a panel in Paris and fell slightly in reaction to Jerome Powell‘s speech four hours later.
The currency pair’s future performance is likely to be affected by tomorrow’s multiple UK releases, US housing data, and Brexit developments.
The GBP/USD currency pair was trading at 1.2411 as at 17:46 GMT having crashed from a high of 1.2519. The GBP/JPY currency pair was trading at 134.38 having fallen from a high of 135.26.

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